Businesses to Welcome Cyber Tribes
Marketers used
to the traditional rules of trade are facing the new digital business
world like the Tower of Babel. However, if they have to stand out in the
growing business crowd, they have to befriend the emerging cyber
communities. A Deloitte study says that the enterprise value of online
communities is not yet realized.
The Deloitte study infers the enterprise
communities have started influencing product innovation and brand value.
So the role of chief marketing officers (CMOs) needs some metamorphosis.
A Deloitte
survey of companies sponsoring online communities indicates that
enterprises have begun to effectively use social media tools and online
communities to engage with customers and employees for brand
discussions, idea generation, and product discovery. However, the survey
also indicates that while these online initiatives are having a positive
impact, enterprises have not yet harnessed the true potential of these
communities.
Deloitte's '2008
Tribalization of Business Survey,' conducted in conjunction with Beeline
Labs and the Society for New Communications Research, points to building
community critical mass as a principal barrier. According to the survey, a
majority of the communities have fewer than 500 active members, and 50% of
the respondents replied that the biggest obstacle to making communities
work is getting people engaged.
Notwithstanding
this challenge, companies reported a significant impact from their
communities. Of the companies surveyed, 35% have seen an increase in
word-of-mouth for their brands, and 28% have seen their overall brand
awareness increase. Online communities are also helping companies increase
customer loyalty and bring outside ideas into the organization faster,
according to 24% of survey respondents.
"Communities can
extend the edge of the corporation in truly transformative ways – tapping
into new talent, helping design products and services, providing customer
support and, most importantly, building the brand with the customer," said
Ed Moran, director of product innovation, Deloitte Services LP. "The
survey data points to some growing pains, but companies are starting to
see that online communities should be nurtured and leveraged for real
business gain."
The tribalization
of business is all about "people helping people," where those who share a
similar passion turn to each other for information, recommendations, and
community feedback. According to the study, 60% of the survey respondents
indicated that their communities are open for public interaction and
feedback.
Conversely,
poorly managed online communities are a critical barrier to their
effectiveness, and 45% of respondents recognize that finding enough time
to manage the community is one of the biggest obstacles to making
communities work. Survey respondents also see facilitation (25%) and
quality of the community manager (34%) as two features that greatly impact
the community's effectiveness, making it critical for companies to devote
the necessary resources to this important role.
The respondents
recognized that communities can be used as a seedbed for innovation.
Indeed, 39% of the companies that participated cited "idea generation" as
the purpose of their online communities, and 19% cited "new product
development" as the key goal.
The survey
indicates that the role of the CMO is being revolutionized through
communities, with the CMO often becoming the lead transformative agent,
empowering the sales, customer service, and product development functions
with the community's intelligence and participation.
According to 42%
of the survey respondents, the marketing organization is now responsible
for driving online communities. With communities becoming a central focus,
marketing is now required to participate in non-traditional functions such
as customer support, idea generation, and employee communications.
While the
Internet has produced unprecedented levels of insight into the size and
demographic makeup of audiences, the survey reveals significant gaps
between community goals and how success is being measured. For instance,
while the top business objectives of the communities were "generate more
word of mouth" (60%) and "increase product/brand awareness" (48%), what is
most measured to assess success are less helpful metrics like "number of
visitors" and "page views."
Not surprisingly,
marketers often remain hard-pressed to identify areas where online
communities are achieving their goals. Management also needs to rethink in
some cases how business value can be extracted from sponsored communities.
The survey
measured the responses of over 140 companies, including Fortune 100
organizations, which have created and maintain online communities today.
Participating companies include leading computer manufacturers, software,
insurance, online auction, media companies, hotel chains, and start ups.
The communities ranged from fewer than 100 members to more than 10,000
members.
This article first
appeared in the old version of My Techbox Online on Jul. 17, 2008.
